The Cost of Getting Workplace Compliance Wrong

The Cost of Getting Workplace Compliance Wrong

6 April 2017

Hear from Joe Murphy, Director, Australian Business Lawyers & Advisors (ABLA), on what it could really cost a business/employer for getting workplace compliance wrong. Businesses have to deal with a really complex set of rules when it comes to managing employees. From reinstatement of a dismissed employee to unlimited damages that could go into hundreds of thousands of dollars - find out the risk your business could be under if you only think you're doing everything right, but not certain.

Video transcription

Risks when dealing with workplace relations

We're dealing with a very complex set of rules for businesses to comply with. They've gotta pay people the right amount of money, they've gotta treat them fairly, they've got to make sure that they don't impinge upon their rights otherwise, and the difficulty is that the penalties for failing to comply with those obligations are quite severe. If we're talking about unfair dismissal, that has a limited range of remedies but the reality is that the primary remedy is reinstatement. And if you've dismissed someone from their employment in your business, the last thing you want is them back in your business. And that's the primary remedy.

So the number one threat is, I might have them back if they go to the Fair Work Commission, and the Fair Work Commission thinks they should come back to work for me. If that's not a risk, because the Fair Work Commission's convinced, or you've been able to convince them, or your lawyer has been able to convince them that they shouldn't come back to the workplace, then they'll look to compensation. And that's up to 26 weeks compensation.

But the risks go well beyond that when it comes to workplace law. The risks when it comes to the areas of discrimination and adverse action, which is a general term to describe treating someone in a negative or detrimental way, because they've exercised some sort of workplace rights, or they had a particular protection, or a particular status, and you treated them adversely, the risk there is that the damage is around unlimited. The risk there is that your legal costs can be phenomenal. You go to the Fair Work Commission, you try and resolve it, the Fair Work Commission's unable to help you resolve it with the individual. And if it doesn't resolve at that stage, it often goes off to the Federal Court or the Federal Circuit Court, and it's when, that's when the real money starts to be spent on legal fees. But you've still got this risk of unlimited damages, and penalties on top of that as well.

Unfair dismissal penalties

And the penalties are up to $54,000 for a company and incorporated business, and if you're not an incorporated business, up to $10,800, or if you happen to be an individual working in an incorporated business, or otherwise involved in a contravention, then you too can be penalised up to $10,800. So the risks are quite significant.

Last year, over 27,000 workplace claims were made through the Fair Work Ombudsman. In many cases, the employer was unaware of any non-compliance on their part. Are you sleepwalking into a $63,000 fine? Don't let that happen to you. Gauge your compliance risk now.